Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What's Happening: Shares of enterprise software company MicroStrategy (NASDAQ:MSTR) surged on Wednesday after the company reported a massive increase in quarterly profits, nearly doubling the average analyst estimate. Up nearly 17% in early morning trading, by 12:30 Wednesday afternoon the stock was up about 10.5%.

Why It's Happening: MicroStrategy came up short in terms of revenue, reporting $123.87 million of revenue for the quarter. Revenue was down 10.2% year-over-year, and it was about $11 million shy of analyst estimates. Despite this revenue weakness, profits soared. MicroStrategy reported EPS of $1.79, a huge swing from the same period last year, when the company reported a $0.57-per-share loss. Analysts were expecting EPS of just $0.96.

The main driver of this earnings beat was a 35% year-over-year decrease in operating expenses, which outpaced the 10.2% decline in revenue. This led operating income to soar from a loss of $8.3 million during the first quarter of 2014 to a gain of $22.6 million during the first quarter of 2015. One component of this drop in expenses was $5.4 million of development costs that were capitalized during the quarter.

While an earnings beat being driven by cost cutting amid a revenue decline may not seem like something to celebrate, the market begs to differ.

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